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How Criminal Law Shapes Institutional Structures: A Case Study of American Prostitution

Prostitution in the United States in the early 19th century was an almost entirely individual, ad hoc, unorganized activity. In the 1910s, the Progressive Movement arrived, bringing with it enforcement of harsh criminal penalties of prostitution for the first time. Within a couple of decades, a rigorously structured, commercialized prostitution industry emerged. Prostitution transformed from a practice into an institution.

This Article lays out a new theory among the unintended consequences of criminalization. Criminalization has the potential to push previously unstructured, independent, ad hoc behaviors to become structured and organized. The Article examines this relationship in the context of American prostitution from the 1850s to 1930s, using contemporaneous sources to tease out the organization of American prostitution before and after the criminalization wave of the Progressive Era. The Article then examines the economic principles that underlie this relationship, including how criminalization creates economies of scale in bargaining for government corruption. In conclusion, the Article argues that policymakers can recognize and respond to this problem in shaping criminal sanctions. Certain criminal regimes, such as partial criminalization that focuses penalties on the purchasers, rather than the sellers of sex work, may alleviate this institutionalizing effect of criminalization and avoid the harms associated with more complex and persistent institutional criminal structures. The Article thus gives theoretical support for current experiments in New York and Sweden in partial criminalization of sex work.